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11 February 2017Written by Henry Lane

Thorgills January market insight

The dawn of 2017 has brought with it a very welcome injection of interest, activity and transactions to the West London property market. Sweeping the economic anxiety of 2016 to one side, landlords, sellers, tenants and buyers are now jumping back onto the saddle and putting their plans into action.

In both the sales and lettings markets, instructions have increased throughout the month of January. This is largely because people have decided to start the new year with a carefully considered change of location, a different sized property or a finance-motivated move. Fortunately, the increase in demand from homeseekers looking to find a new home in the first quarter of any given year is usually matched by a similar increase in the supply of properties by landlords and sellers, and this year is no different.

The sheer volume of both properties and homeseekers means that the properties which represent best value for money are likely to go under offer swiftly. Furthermore, those buyers and tenants who are most flexible and most prepared to move quickly are snapped up by sellers and landlords who can take their pick of the interested parties to best suit their circumstances.

In the sales market, the enforced downtime of the Christmas and New Year break allowed families to consider their finances and take the plunge to upsize, buy an investment property or help the younger generation onto the first rung on the property ladder. In the last month, 30% of properties sold are being bought by first time buyers. This represents a significant shift from January 2016, when investors jumped to the front of the queue to hastily buy entry-level properties before the stamp duty tax rose.

Canny international investors are taking advantage of the drop in demand for London property amongst overseas buyers. Given that the pound is relatively weak, an international investor can purchase a brand new property off-plan for a lower price than they could have done pre-referendum. Many of these overseas buyers are deterred from investing in the UK because of Brexit-related fears, so with fewer buyers competing to buy these new build apartments, the tenacious and pragmatic investor has less competition and can benefit from both favourable exchange rates and long term profit.

The lettings market has in the last month seen a surprising uplift in demand from multinational companies renting properties for their senior employees, perhaps as a means of attracting high quality candidates from the continent by offering premium accommodation. Such companies are performing well and, most importantly, they are retaining their West London presence rather than moving abroad where trade deals and tax rules may prove more favourable when the UK leaves the EU. There has been an increase in director-level employees relocating closer to their West London workplaces to take advantage of the excellent schools, green open spaces and high quality housing stock that the area has to offer.

In summary, it appears that so far in 2017 the market has picked itself up and the anxiety of 2016 is a distant memory. Those who are committed to moving are doing so confidently with the belief that life must carry on regardless of the economy's regular ebb and flow.